GOP immigration supporters face back-tax dilemma

The Gang of Eight has all but dropped what was a major talking point. | John Shinkle/POLITICO

Instead, Graham’s office pointed POLITICO to the “interesting contrast of criticisms” on back taxes by the Center on Immigration Studies, which has blasted the overhaul authors for bailing on the notion of back taxes but also admitted that it’s not “administratively feasible” and not a huge chunk of money in the first place.

A number of tax experts agree that back taxes won’t be a windfall for the Treasury since more than half of illegal immigrants already pay taxes, many using a stolen Social Security number taken for their jobs.

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Over in the House, aides working on yet-to-be-revealed bipartisan immigration reform say the back tax issue hasn’t really come up yet — but signs of a struggle are already there.

Rep. Raul Labrador of Idaho, the GOP front-runner in the House bipartisan immigration coalition, said in a Los Angeles Times op-ed that the bill should include back tax provisions. But a Democratic aide working on the House’s bipartisan immigration overhaul told POLITICO that this is just too tough.

“The idea of retroactively getting people to pay taxes owed is a bureaucratic nightmare and opens the door to giving immigrants credit for taxes they have already paid,” the staffer said.

Still, Hatch is confident that lawmakers will have to give his amendment a closer look.

“They said they’d try to work with me, so we’ll see,” he said.

A Senate aide familiar with the legislation but not working for a Gang of Eight member told POLITICO that the Hatch proposal would likely be adopted, arguing Republicans would have to vote for the amendment since they’ve been talking for months about immigrants making restitution of unpaid back taxes; otherwise, they’d be seen as backpedaling.

And Democrats from red or purple states could also feel pressure to approve the Hatch amendment because the politics of not doing so could rub their constituents the wrong way — even if some experts believe the idea of collecting back taxes is next to impossible.